Driving down high drug prices was one of the cornerstones of U.S. President Donald Trump’s campaign when he was running for office in 2016. The ongoing pricing debate reached a pinnacle at the time when then-chief executive of Turing Pharmaceuticals, Martin Shkreli, hiked the price of an old med, Daraprim, by more than 5,000% in 2015.

Once elected, President Trump picked Scott Gottlieb to lead the FDA and help tackle the issue. Gottlieb had said that the main problem behind high drug prices isn’t the cost of new, specialty drugs but instead old drugs whose sellers can indiscriminately raise prices because there isn’t enough competition from generics, like in the case of Daraprim.

In an op-ed Gottlieb wrote for The Wall Street Journal, he said “generic drug applications used to cost about $1 million but can now cost as much as $20 million, making it too expensive for companies to bring their competing products to market.”

In a pro-Pharma/Republican move, Gottlieb criticized the call among Democrats, led by Hillary Clinton, to more heavily regulate drug makers. Gottlieb said instead of throwing new regulations on new drugs, the FDA should focus on opening the door to generic versions of old drugs to help lower costs. He has also been a big proponent of getting biosimilars to market to help drive down prices.

However, as this issue went to press, on March 7 at the National Health Policy Conference for America’s Health Insurance Plans, Gottlieb criticized a “rigged” system that’s hurting uptake and development of biosimilars, saying the agency will do what it can to try and fix the situation.

Fast-forward two-weeks, on March 23, The Wall Street Journal reported contrary to his campaign promises to lower drug costs, President Trump’s administration had actually shifted gears when it unveiled plans to get rid of regulations that promote lower prices of some biologics. The President had in fact overturned a policy implemented under former President Barack Obama that aimed to encourage the use of biosimilars.

Drugmakers lobbied to overturn the former president’s policy, which gave incentives to doctors to prescribe biosimilars over more expensive biologics. The drugmakers said that the measure would discourage investment in biologic development.

Advocates of the new Pharma-friendly policy say it will allow industry to earn sufficient profit and attract more competitors to the market, which will reduce costs over the long-term.

In the Journal story, Coherus BioSciences executive vice president for sales and marketing, Michael Fleming, said it was a very positive move because it “means that we’re in command of our own pricing strategy.”

The new policy covers biosimilars purchased under Medicare Part B, while biologics comprised two-thirds of the $21 billion spent under the program in 2014.

On the flip side, Sanford C. Bernstein & Co. analyst Ronny Gal was quoted in the Journal piece saying, “The Trump administration may be talking against [high] drug pricing, but every action they’ve taken so far has been highly supportive of the industry.”

Just weeks after his comments against the “rigged” system, in an interview with CNBC’s Meg Tirrell on March 28 at the Healthy Returns conference, Gottlieb’s aforementioned optimism for biosimilars was gone, saying that early estimates of savings that could be garnered through biosimilars in the U.S. “probably weren’t realistic” and that “[t]he economics of development are currently unstable; and the pipeline of biosimilar products that we hope for could be dramatically affected by the weakening of market incentives to bring these products to patients.”

I wonder what impact President Trump’s policy shift had on his thinking?

Tim Wright, Editor
twright@rodmanmedia.com